Kingston Council could follow Northamptonshire County Council into effective bankruptcy in little more than two years according to the authority’s leader.

Councillor Liz Green, who took over the leadership at the May elections this year, said there is still time to avoid collapse, but the council needs to act fast, She warned of “tough decisions” ahead.

She said: “We are not bankrupt, but I think we are about two years behind Northamptonshire.

“Some of the decisions they were taking two years ago are very similar to what we are going through right now.

“If we do nothing and don’t get on top of the finances, we could be in effective bankruptcy by 2021.”

Councils do not go bankrupt, but rather are forced to issue a Section 114 notice admitting they do not have the money to meet their current expenditure, which is what Northamptonshire County Council has done twice so far this year.

In practice this could mean the government stepping in and taking control of the council, or forcing huge cuts to non-essential services.

Cllr Green said: “We are in the position where we can turn it around. It’s going to be hard, but we can turn it around.”

The council predicted a £3.9m overspend for this financial year at a meeting on October 4, with some of the planned £22m in savings from this year’s budget at risk of not being achieved.

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The leader of the previous administration, current opposition leader Councillor Kevin Davis, said Kingston’s finances are in fact fine, and said the planned workforce savings were detailed, and that a business case for the investment company was made when the budget was agreed earlier this year.